Wednesday, November 21, 2012

The District said Monday that hundreds of city
workers took nearly $2 million in fraudulent unemployment benefits, a
scandal that roiled the D.C. government earlier this year and prompted
widespread firings and criminal charges.Lisa Mallory, the director of the D.C.
Department of Employment Services, told the D.C. Council that her agency
had detected $1.9 million in overpayments to District workers who
collected unemployment benefits while on the city's payroll."This probe continues to be ongoing," said
Mallory, who has credited access to a specialized database for the
initial detection of the fraud.

Lisa Mallory, who directs the D.C. Department of
Employment Services, revealed the jobless rate during an appearance
before city lawmakers on Monday -- one day before the federal government
planned to release state unemployment rates from across the country.

Although the Bureau of Labor Statistics has imposed
tight restrictions on the release of pivotal economic indicators, an
agency spokesman said Mallory violated no federal rules by disclosing
the District's unemployment figure early.

Mayoral spokesman Pedro Ribeiro said Mallory's comment was likely a slip of the tongue.

"Sometimes, it's hard to contain yourself when you have good news," he said.

Mallory's department has referred 318 cases to
the District's inspector general, some of which have resulted in civil
lawsuits and criminal prosecutions. Other cases are pending."Many of these individuals did lose their
employment," Mallory said. "There are several cases in front of the U.S.
attorney, and those will take their course."Pedro Ribeiro, a spokesman for Mayor Vincent
Gray, said he did not know when the city's probe would conclude, but he
said Gray remained committed to the investigation."We intend to move it until every case is
closed," Ribeiro said. "They're going to settle, we're going to sue
them, or they're going to go to jail."The District has already managed to recoup
about $1 million in the overpayments, Mallory said, with other employees
already on payment plans.The scandal has widened since the District
first revealed the fraud in early February. At the time, D.C. officials
said their internal review had implicated 130 current or former
employees and appeared to have cost taxpayers $800,000.But Mallory said the upgraded database has allowed authorities to expand their investigation and detect other fraudsters.Prosecutors have secured plea agreements with some, and sentences have varied.In August, a judge sentenced a former employee
of the District's public school system to 45 days in jail for stealing
$27,200 in benefits while employed.The month before, though, a former Department
of Consumer and Regulatory Affairs employee received a suspended jail
sentence for accepting about $18,000 in fraudulent benefits.

The
District said Monday that hundreds of city workers took nearly $2
million in fraudulent unemployment benefits, a scandal that roiled the
D.C. government earlier this year and prompted widespread firings and
criminal charges.
Lisa Mallory, the director of the D.C. Department of Employment
Services, told the D.C. Council that her agency had detected $1.9
million in overpayments to District workers who collected unemployment
benefits while on the city’s payroll.

“This probe continues to be ongoing,” said Mallory, who has credited
access to a specialized database for the initial detection of the fraud.
Mallory’s department has referred 318 cases to the District’s inspector
general, some of which have resulted in civil lawsuits and criminal
prosecutions. Other cases are pending.
“Many of these individuals did lose their employment,” Mallory said.
“There are several cases in front of the U.S. attorney, and those will
take their course.”